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Investment banks are raking in record sums, with fees surging past $100bn in the first nine months of the year thanks to a rush of dealmaking.
Wall Street’s top banks and leading boutique advisers have benefited from the boom in mergers and acquisitions as well as hot equity capital markets. Fees for both are at the highest level since records began two decades ago and have hit $60.6bn in the year to date, according to Refinitiv.
Lenders also earned $52bn underwriting loan and debt offerings in the first nine months of the year as companies rushed to lock in low rates.
Five US banks, led by JPMorgan Chase and Goldman Sachs, have taken the greatest share of the $112.6bn in fees earned this year. The two Wall Street lenders are estimated to have hauled in a combined $18bn in fees.
Thanks for reading FirstFT Americas and have a great weekend. See you Monday — Gordon
Five more stories in the news
1. Democrats delay infrastructure bill vote Congressional Democrats postponed a make-or-break vote on Joe Biden’s $1.2tn bipartisan infrastructure bill in the US House of Representatives after a manic day of negotiations. However, the House and Senate both passed a “continuing resolution” to fund the government for another two months and avoid a shutdown ahead of a midnight deadline.
Go deeper: Is Joe Biden’s domestic agenda at risk of being torpedoed by divisions in his own party? James Politi and Lauren Fedor report on the prospects for agreement between progressives and moderates.
2. Facebook pressed to release user research Senators on the US commerce committee pressed Antigone Davis, Facebook’s head of global safety, to release all of its internal research into how its products affect users, after a series of revelations about the harm some of its platforms cause to vulnerable groups including children.
3. Evergrande bonds snapped up by distressed debt investors US distressed debt funds are flocking to buy bonds issued by Chinese property developer Evergrande, betting that Beijing will be forced to rescue the country’s most indebted company.
4. US and EU could do ‘more and better’ on tech security US secretary of state Antony Blinken has called for the US and Europe to improve information sharing on companies that pose a risk to national security. Representatives from the US government and EU held a summit this week in Pittsburgh despite French efforts to have the meeting cancelled after being excluded from the Aukus security pact.
5. Zoom and Five9 abandon $14.7bn deal Zoom Video Communications’ bid to buy the cloud software provider Five9 has collapsed only weeks after the US Department of Justice raised national security concerns over the deal and shareholders were advised to vote against the takeover by a powerful proxy group.
Coronavirus digest
Merck said it would ask US regulators to authorise the first antiviral pill to treat Covid-19 after a late-stage clinical trial showed the drug cut the risk of hospitalisation or death in half.
Eurozone inflation rose to its highest level for 13 years in September, lifted by soaring energy costs.
Vietnam is loosening a strict, nearly three-month lockdown in Ho Chi Minh City after a stark warning from business and a record quarterly drop in gross domestic product.
Students are pushing back against “YouTube” learning as campuses reopen.
The day ahead
Data The Institute for Supply Management releases its monthly report on manufacturing activity in the US today and the Commerce Department is scheduled to report consumer spending data for August.
Monetary policy Federal Reserve Board New York president John Williams and ECB executive board member Isabel Schnabel speak at the “Implications of Federal Reserve actions in response to the Covid-19 pandemic” event, organised by the Federal Reserve Bank of New York.
Dubai World Expo After a year-long delay, Dubai’s Expo 2020 will kick off today. Attendees will need to show proof of vaccination or a negative Covid-19 test. It is expected to be one of the largest in-person events since the pandemic began.
Join us on October 7-8 for the Moral Money Summit Americas, debating money, regulation and how businesses can act more responsibly. Sign up here to receive the Moral Money newsletter in your inbox.
What else we’re reading
Stagflation fears intensify With oil topping $80 a barrel, global food prices a third more expensive than they were a year ago and other commodities at decade highs, investors say a longer than expected inflationary surge is coinciding with a slowdown in growth — an old nemesis for investors known as stagflation.
Will the next web be built on ethereum? Interest in the ethereum blockchain has soared over the past year. Supporters claim it could be the platform for what has become known as Web 3.0, where a series of decentralised apps could one day challenge Big Tech’s offerings. But there remain fundamental questions over whether ethereum will be able to compete with nimbler rivals, writes Richard Waters.
The west is the author of its own weakness After 25 years, Philip Stephens pens his final column, and reflects on how policymakers’ challenges have evolved in this time. When his column first appeared, “the world belonged to liberalism”, he writes. Now, western democracies are threatened by a lack of public trust. “Public faith in democracy — in the rule of law and the institutions of the state — rests on a perception that the system at least nods towards fairness,” he writes.
Taliban confront reality Delivering the administrative services to which Afghans have become accustomed is a tall order at a time of economic collapse, withdrawal of western financial support and an exodus of expert administrators since the Taliban takeover. But there is one service that is both available and popular under the Islamists: speedy justice.
Algorithms could guide decisions — if they work Life is full of difficult decisions. Who should be hired or fired? What grades should students receive in their exams? An increasingly popular solution is to delegate those decisions to a data-driven algorithm. But many of them have been trained on racist, sexist information, and it shows, writes Tim Harford.
Travel
The new 190-mile Aquarius Trail in Utah is billed by its creators as “the greatest bicycle adventure in the American West”. Tim Neville explores.
Source: Economy - ft.com
